2024-08-29 16:55:02
Almost all of Nvidia’s numbers were heading up but the chip maker’s sky-high margins do appear to be moderating.
Nvidia said its July-quarter gross margin stood at 75.1%, up from 70.1% a year ago, but down from 78.4% in the first quarter. It expects a gross margin of 74.4% in the current quarter.
“A higher mix of new products in Data Center puts pressure on profitability,” wrote D.A. Davidson analyst Gil Luria in a research note on Thursday.
Luria has a Neutral rating and a $90 price target on Nvidia stock, making him one of the few relatively bearish analysts on the company.
“Over the next 3-5 quarters, we still believe a decline in demand for Nvidia compute is inevitable, as end customers are going to become more scrupulous when it comes to the ROI [return on investment] on their AI compute,” Luria wrote.
